Mayor warns hard Brexit could lead to 'lost decade' of growth and employment
New independent economic analysis commissioned by the Mayor of London, Sadiq Khan, indicates that a 'no deal' hard Brexit could lead to a lost decade or longer of significantly lower growth. The worst-case scenario could result in:
- 500,000 fewer jobs
- 87,000 fewer jobs in London by 2030
- nearly £50bn UK-wide investment lost by 2030
Financial and professional services could be the hardest hit with 119,000 fewer jobs nationally. Other sectors reported include: science and technology (92,000 fewer jobs), construction (43,000 fewer jobs) and the creative sector (27,000 fewer jobs).
Even softer Brexit scenarios, like the UK remaining in the Single Market, but leaving the Customs Union after a transition period could still result in a 176,000 fewer jobs across the country.
The report also shows that London could suffer much less from Brexit than the rest of the country - increasing geographic inequalities across the UK.
A future trade relationship must be agreed between the Government and the EU by 27 October this year. The Mayor is warning that with just 10 months to go, time is running out.
In total, five scenarios were modelled by Cambridge Econometrics to illustrate the range of possible outcomes of the UK’s future relationship with the EU. These are:
- Scenario 1 - A ‘close to status quo’ scenario where the UK remains part of both of the single market and customs union
- Scenario 2 - A scenario where the UK remains part of the single market, but not the customs union
- Scenario 3 - A scenario where the UK remains part of the customs union, but not the single market
- Scenario 4 - A hard Brexit scenario in which trade between the UK and the EU falls under World Trade Organisation (WTO) rules with a two-year transition period from March 2019
- Scenario 5 - The same hard Brexit scenario but without a two-year transition period
A future trade relationship must be agreed between the Government and the EU by October this year. The Mayor is warning that with just 10 months to go, time is running out.
I’ve released these impact assessments because the British people and our businesses have a right to know the likely impact on their lives and personal finances.
This new analysis shows why the Government should now change its approach and negotiate a deal that enables us to remain in both the Single Market and the Customs Union.
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